13 March 2017

Thinking of buying a second hand vehicle, watercraft, caravan or motorcycle?

If you are considering buying a second hand motorcycle, trailer, caravan, watercraft, aircraft or other ‘vehicle’ from a private seller then you should always consider conducting a Personal Property Securities Register (“PPSR”) search.

Conducting a search is important when purchasing from a private seller through Gumtree, Facebook or newspaper advertisement.  However, a search need not be conducted if purchased through an authorised second hand vehicle dealer.

A PPSR search costs as little as $3.40 and it will reveal whether or not there is a security interest already registered over the vehicle.  This is important, as if you acquire property over which a debt is owed, the debtor may be able to take possession of the property in order to satisfy the pre-existing debt. Alternatively you may end up paying off the previous owner’s car loan. This is because the loan is charged over the car itself (a bit like a mortgage over a property) and not the individual.  This can leave the purchaser out of pocket.

In some instances the search may also provide other useful information such as registration details, description of the vehicle and whether the vehicle has been reported as stolen or has a written off status.

A PPSR search is easy to conduct, all you need is the vehicle’s VIN number or the watercraft’s HIN (hull number).  Other property may be searchable by reference to some other serial number.  This information is available on the PPSR website.  The search can be conducted online or through the PPSR contact centre.

On completion of the search you will be issued a certificate.  If the certificate states that “there is no security interest or other registration kind registered on the PPSR against the serial number” then this means that there is no outstanding debt owed on the vehicle.  Provided that you have conducted the search either on the day of purchase, or the day before purchase then you will be protected and have peace of mind.

If however the search reveals registered interests, then the asset in question is subject to those interests.  If you are considering purchasing a car that has a registered security interest, then there are steps that you can take to protect yourself.  These include attending at the financier’s office to ensure the owner uses the money you pay for the car to first satisfy the remainder of the loan.

If you have any questions in relation to the Personal Property Securities Register please contact our commercial department on 4036 9700.

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